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Diane Urquhart's Statement on ABCP CCAA Restructuring Plan Decision of the Supreme Court of Canada  

The Ad Hoc ABCP Retail Noteholders Committee recommended that the Supreme Court of Canada not hear the ABCP CCAA Restructuring Plan appeal, so it is relieved by the Supreme Court's decision on Friday, September 19, 2008. The Co-Counsel for this Committee, including Henry Juroviesky of Juroviesky and Ricci LLP, Arthur Jacques of Shibley Righton LLP and myself as financial advisor, recommended that the retail ABCP owners of less than $1,000,000 accept their cash settlements at full par value, plus accrued interest and restructuring costs, from their securities dealers, Canaccord and Credential. The retail customers owning less than $1,000,000 of Non Bank ABCP were paid a cash settlement that mitigated their damages for a flawed savings product that was sold to them as safe and liquid, when this was not the case. The retail victims are expected to get their lifesavings back in October and to return to their normal lives.

The retail owners worked hard to accomplish this settlement of just getting their own money back, with the assistance of the Co-Counsel appointed to represent them in the CCAA court-administered CCAA process. The Federal and Provincial governments were not helpful to this group of Canadians getting their money back. In fact, many retail ABCP owners were shocked to learn that our governments actually facilitated the sale of this flawed money market product into the unsophisticated retail marketplace through multiple law and regulation changes, blind enforcement and exemptive relief decisions that allowed the securities dealers and banks to side-step investor protection laws that Canadians fought years to achieve.

There is now urgent need for reform of our securities regulation and securities crime policing structures in Canada. Plus, we must proceed to make amendments in various securities and banking laws and regulations to prevent a similar crisis in the money market ever again. Given that the ABCP CCAA Restructuring Plan denied the rights of corporations, governments, pension funds and individuals to sue the securities dealers for negligence and civil fraud, we will have to amend the Companies Creditors Arrangement Act to explicitly restrict the right of judges to approve debt restructuring plans that deny the right of creditors to sue solvent third parties who exposed Canadians to harm.

I sincerely hope that the government regulators will now intervene on behalf of the individual victims owning more than $1,000,000 of the Non Bank ABCP who have lost their democratic right to sue for the return of their lifesavings and who now bear a disproportionate share of over $16 billion of marked-to-market harm, which solvent securities dealers have imposed on Canadian high net worth individuals, pension funds, corporations and governments.

Diane Urquhart
Independent Financial Analyst
Mississauga, Ontario
Telephone: (905) 822-7618
Cell: (416) 505-4832